2023-07-28 11:00:00
CaixaBank has closed the first half of the year with a net profit of 2,137 million queos, which means increasing its results by 35.8% compared to that obtained in the same period last year. The strong increase in interest income, derived from the continuous rate hikes that the ECB (European Central Bank) has been applying for twelve months, explains a good part of this behavior of the financial institution in which the State has a 16% stake. .
With these figures, the CEO, Gonzalo Gortázar, considers that the “normalization of interest rates”, which have gone from 0% to 4.25% in less than a year, implies that “margins advance significantly”. Above all they have done so in the mortgage portfolio, whose installments have increased due to the rise in the Euribor. However, the executive considers that it is a “manageable problem” because the average increases in CaixaBank mortgages are “between 90 and 110 euros per month,” he explained. “We do not have a massive problem to deal with,” Gortázar insisted, ruling out that the rise in mortgages “is 300 euros as they speak”, but rather that the average is much lower. In fact, he has anticipated that the Euribor will close the year below 4% and in April 2024 it will be at a lower level than this year. “The problem is going from more to less,” he has predicted.
The request of customers to take advantage of relief measures due to the rise in interest rates has a minimal reflection in CaixaBank, as is happening in the rest of the financial sector according to the accounts that are presenting these days. In the first half of the year, the entity has received 5,600 applications that fit into the Code of Good Practices, of which 1,900 have already been signed or are in the process of being signed. More novations to fixed mortgages (3,500) have materialized and more than 10,000 refinancings to individuals have been carried out, as well as specific agreements with mortgaged customers. For this reason, the CEO of the group does not advocate changing that code, as the PSOE has promised in the electoral campaign to increase the number of potential beneficiaries, because he considers that “the rate hike is coming to an end and we must direct our energies to improve other problems and that the mechanisms enabled so far continue to work.
The CaixaBank business, an entity closely linked to the mortgage market and with the largest payroll market share in the sector in Spain, has acted as the driving force behind achieving these results for the entire group. In a context of widespread increases in variable mortgage payments, delinquency has not been affected so far. In fact, the level of defaults stands at 2.6% of its ‘stock’ of credits. This is the best data in the last 15 years, when the great recession was threatening Spain.
Specifically, it has obtained 4,624 million euros in that item, which is 55% more year-on-year. This amount, together with the improvement in the result of the insurance service (with a growth of 18.5%) and the income from bancassurance investees (almost 60% more), offset the drop in commissions of 4.2 %.
In the first half of the year, CaixaBank has managed to increase customer resources (deposits and savings accounts), which stood at 627,824 million euros at June 30 (2.7% in the year), thanks to seasonality usual positive trend in sight savings at the end of the second quarter and the good evolution of long-term savings products. Regarding deposits and their remuneration, Gortázar has stated that it is “a process that is gaining strength and the logical thing is that it will continue” in the coming months.
In the first six months, net subscriptions to investment funds, pension plans and savings insurance reached 5,100 million euros. The combined market share of long-term deposits and savings stands at 26.5%. In addition, there is continued growth in protection insurance, with year-on-year increases of 3.4% in new life-risk production and 13.6% in non-life.
The bank has paid 373 million euros this year for the extraordinary tax approved by the Government to the financial sector. This amount has served the entity to remember that, together with what they pay for Companies (more than 1,000 million) and the deposit tax (57 million), 40% of their attributed result (2,137 million) goes to them in taxes . Therefore, Gonzalo Gortázar if the Executive wants to “penalize” the bank with taxes. “It makes no sense to tax banks more than other activities and that harms the country. The bank has to be profitable and support growth”, he insisted in the press appearance.
CaixaBank is advancing this semester in achieving the objectives of the 2022-2024 Strategic Plan, among which are generating around 9,000 million euros of capital and attractive remuneration for shareholders.
Dividend of up to 60% of profit
The entity has communicated its intention to carry out a new share repurchase for a total amount of 500 million euros, subject to mandatory regulatory approval, which is expected to begin before the end of 2023. This is the second share repurchase in the framework of the Strategic Plan, since between May and December 2022 a share buyback program was carried out for a value of 1,800 million euros.
In addition, on April 12, the entity paid its shareholders 0.2306 euros per share. With the payment of this dividend, the amount of shareholder remuneration corresponding to the 2022 financial year amounted to 1,730 million euros, equivalent to 55% of the consolidated net profit for that year. Regarding the dividend policy for the 2023 financial year, the Board of Directors approved in February a cash distribution of between 50% and 60% of the consolidated net profit, which would be paid in a single payment during April 2024, subject to final board approval.
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